On June 20, 2012, the U.S. Securities and Exchange Commission (the "SEC") adopted final rules1 (the "Final Rules") to implement Section 952 of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the "Dodd-Frank Act") concerning the independence of compensation committees, the engagement and independence of compensation advisers and new proxy statement disclosures regarding compensation consultants

Companies are required to make information filings with the IRS in early 2011 to report exercises of incentive stock options ("ISOs") and transfers of stock purchased pursuant to employee stock purchase plans ("ESPPs") occurring in 2010.

The Patient Protection and Affordable Care Act (the "Act"), signed into law by President Obama earlier this year, imposes new requirements on group health plans and flexible spending arrangements that may necessitate Section 125 cafeteria plan amendments and changes in administrative procedures by year end.

In January 2010, the Internal Revenue Service (the "IRS") issued Notice 2010-6 (the "Notice"), which allows taxpayers to correct plan documents of non-qualified deferred compensation arrangements that do not strictly comply with the requirements of Section 409A of the Internal Revenue Code, as amended, (the "Code").

The Department of Defense Appropriations Act for Fiscal Year 2010 was signed into law by President Obama on December 19, 2009. The Act extends the eligibility for and the duration of the temporary federal COBRA subsidy provided by the American Recovery and Reinvestment Act of 2009.

The IRS recently issued a final regulation (the "ESPP Final Regulation") relating to options granted under an employee stock purchase plan (an "ESPP") as defined in Section 423 of the Internal Revenue Code, as amended (the "Code"), and a final regulation (the "Reporting Regulation") regarding the reporting requirements for incentive stock options granted under Section 422 of the Code ("ISOs") and ESPPs.

Given the recent tumult in the financial markets, resulting in the downward movement of stock prices, many public companies are required to manage the challenges associated with an increasing number of underwater stock options.

The U.S. Department of Labor (the "DOL") recently finalized a regulation (the "Final Regulation") regarding a safe harbor under the Employee Retirement Income Security Act of 1974, as amended ("ERISA") for the investment of plan assets and certain default investment options that qualify as "qualified default investment alternatives ("QDIAs").

The IRS recently extended to December 31, 2007 both the deadline for adopting written plan amendments to bring NQDC arrangements into compliance with Section 409A and the period during which NQDC arrangements may be operated in good faith compliance with Section 409A. The IRS also extended until December 31, 2007 the period during which an NQDC arrangement may permit new elections to be made with respect to time and form of payment. However, certain restrictions apply to election changes that wo

On December 23, 2005, the IRS issued Notice 2006-4 which provides interim guidance with respect to the application of the new rules for non-qualified deferred compensation under Section 409A to stock options granted by private companies.